Coronavirus impact: Careem announces over 500 job cuts across its business
Dubai - The cuts make up 31 per cent of its workforce.
Ride-hailing company, Careem, has announced that it is cutting 536 jobs across its business as a result of the impact of the Covid-19 pandemic.
In a blog post on the company website on Monday, co-founder and CEO Mudassir Sheikha, revealed that the cuts make up 31 per cent of its workforce.
"We delayed this decision as long as possible so that we could exhaust all other means to secure Careem," he said. "As we have discussed several times in the last few weeks, the crisis brought on by Covid-19 has put our dream and future impact at significant risk. Our business is down by more than 80 per cent and the recovery timeline is alarmingly unknown. Our parent company Uber, believes in our Super App vision and is committed to the region, but like others in the industry, is also impacted by the crisis."
In a statement to Khaleej Times, Sheikha said that the decision of letting people go was "a last resort."
"These are the people that helped build Careem and create massive change and impact for our communities across the region. We greatly value their work and dedication and sincerely hope we will be able to hire those people back once we build a sustainable basis for our future," he said. "The impact of Covid-19 on our business and industry has been severe and has forced us to change the shape and size of our organisation so that Careem can be here for the long-term - which we will."
Sheikha also announced that a decision had been made by the company to suspend Careem BUS. "The economics of the mass transportation business have improved but remain challenging, and at this time, we need to accelerate our investments in deliveries and the Super App. We believe Careem BUS is a much-needed offering in some of our core markets, and I predict that the service will reappear on the Careem Super App in the future."
Highlighting the support that the impacted employees will receive, Sheikha said: "While the details vary slightly by market, we have arranged at least three months of severance pay, one month of equity vesting, and where relevant, extended visa and medical insurance for you and your family until the end of the year. We are also offering a set of resources including counseling that can help you get through this event and find your next professional opportunity."
He added: "We also recognise the value of the Careem alumni network and encourage you to join a Slack community that has been set up specifically for former colleagues. When we are hiring again, we plan to post all opportunities on that channel and we will be encouraging alumni to do the same for their new companies."
Uber ends Eats delivery in seven markets in strategic pullback
Uber on Monday announced that it is discontinuing its Uber Eats restaurant delivery service in seven markets next month, including the Czech Republic, Egypt, Honduras, Romania, Saudi Arabia, Ukraine, and Uruguay.
The announcement comes as part of a strategic shift for the ride-hailing service, which has been hit hard by the coronavirus pandemic. Food delivery will end in by June 4, according to a regulatory filing. The changes do not affect Uber Rides operations in those countries.
The seven countries accounted for just one per cent of Uber Eats bookings, according to the company, but four per cent of its losses.
Uber said the decisions to exit the seven markets were made as part of an "ongoing strategy to be in first or second position in all Eats markets by leaning into investment in some countries while exiting others."